Market (Page 16)

The OPEC+ alliance’s dramatic failure to reach an output deal is most obviously being felt in oil futures, which plunged the most since 2008 in London. A look at the less-conspicuous corners of the market reveal the scale of the impact.

The potential collapse of the group led by Saudi Arabia and Russia is the latest blow to a market that was already dragged down by fears over the economic damage from the spread of the coronavirus. Global benchmark Brent crude, which was already down 24% through March 5, dropped 9.4% on Friday after the talks between members of the alliance collapsed in Vienna.

With Russia refusing to bend to Saudi Arabia’s wish for further output cuts, the producer group’s supply reductions of 2.1 million barrels a day will not continue beyond the end of this month. They will be free

The gold to silver ratio, which indicates the relative strengths of both the metals, is testing three-decade high. At present, the gold to silver ratio is 96.5, not seen since 1991. The ratio rises when silver underperforms gold. Historical data shows that whenever this ratio rises to very high levels, it never sustains and falls.

This ratio suggests how many ounces of silver can be bought with one ounce of gold. In India too, like their global peers, traders use the ratio. When they expect the ratio to rise, they buy gold and sell silver.

Ajay Kedia, director, Kedia Commodities said, “The gold silver ratio is currently at at level of 96.5. It has seen a jump of about 19% in the last six months. Gold prices have also jumped in this period to Rs 44960 and have moderated from there.

Mirroring global peers, the Indian stock market, too, crashed on Friday as a double whammy of Coronavirus jitters and a sharp sell-off in banking space owing to developments around State Bank of India (SBI) and Life Insurance Corporation of India (LIC) picking stake in the troubled private sector lender YES Bank, compelled investors to pull out money from the equities and rush to safe havens.

The S&P BSE Sensex tanked over 1,450 points or 3.8 per cent at open to 37,000 levels. NSE’s Nifty50 slipped below 11,000 levels and hit a low of 10,827. However, both indices recovered partially as trade progressed. In the currency market, rupee tumbled to 74 a dollar for the first time since October 31, 2018. On Thursday it ended at 73.33.

Adani Ports and Special Economic Zone (APSEZ), the leading ports and logistics company, surged over 1.5 per cent on Thursday after the company’s Board of Directors declared an Interim Dividend of Rs 3.20 per equity share.

“The Board of Directors of the Company at its meeting held on March 4, 2020, has declared an Interim Dividend of Rs 3.20 (160 per cent) per equity share of Rs 2 each for the financial year 2019-20,” Adani Ports said in its press release.

Record date for the payment of interim dividend has been fixed on March 17, 2020. The said interim dividend will be remitted on and after Thursday, March 19, 2020 and will be paid within the timelines stipulated under the Companies Act, 2013, the company informed.

Shares of aviation companies were under pressure on Wednesday, falling upto 8 per cent on the BSE, on concerns that the industry may face risks from the coronavirus outbreak.

Among individual stocks, SpiceJet slipped 8 per cent to Rs 68.60, its lowest level since October 11, 2018 on the BSE. Thus far in calendar year 2020 (CY20), the stock has tanked 39 per cent, as compared to 6 per cent decline in the S&P BSE Sensex in the same period.

Shares of InterGlobe Aviation, parent of the country’s largest airline IndiGo, dipped 4.6 per cent to Rs 1,173 on the BSE. The stock was trading close to its 52-week low of Rs 1,119, touched on March 5, 2019. It has fallen 12 per cent thus far in CY20.

The sudden and rapidly spreading coronavirus respiratory disease is centered in China but has spread internationally, drawing

Gold rose nearly 1 per cent on Monday after suffering its largest daily fall in nearly seven years, as expectations grew for policy easing by the U.S. Federal Reserve and other central banks to help boost the coronavirus-hit global economy.

Spot gold was up 0.4 per cent at $1,591.84 an ounce by 1:40 p.m. EST (1840 GMT), and U.S. gold futures settled 1.8 per cent higher at $1,594.80.=>

On Friday, the precious metals market was routed by traders liquidating their positions amidst a coronavirus-led selloff across global markets, with gold diving as much as 4.5 per cent.

“We are seeing a little bit of recovery from late last week, (when) there was lot of selling to generate liquidity and cover margins,” said Ryan McKay, a commodity strategist at TD Securities.